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Issue 20

Cluj IT Cluster on Entrepreneurship

Daniel Homorodean (duplicate)

OTHERS

From the very first day the Cluj IT Cluster was created, we were confronted with the question of how we plan to support the local entrepreneurship. The question constantly accompanied us all the time in over one year since the Cluster was founded, at all conferences and events attended by our representatives.

The question was - of course - always answered, though we always felt that in a certain measure the given answer was not enough, neither for the ones who asked, nor for us, the members of the Cluster.

This comes from the fact that we have assumed an ambitious role in supporting the evolution of the Romanian IT industry, we have created expectations that we have to fulfil, and we are aware that we will be evaluated by the objective results we deliver.

Cluj IT Cluster came into being following a direct need, from the understanding that the way Romanian IT industry has grown and worked for many years may not be sustainable in the long term. There are over 8,000 IT professionals in Cluj, an impressive concentration if compared to the population of the city. We got to this number by an organic and relatively fast growth that has relied primarily on the low cost of the labour force, and afterwards on a cost that is competitive for the qualification and quality of our programmers. Still, relying on the cost of the labour force as the main growth factor is not just a dangerous strategy, but a suicidal one, as the continuously growing cost of production in Romania tends to diminish the advantage we have compared to our traditional markets (Western Europe and the U.S.).

It is not a secret for anyone that the only way to ensure growth in the long run is to create additional and sustainable value, and the healthiest way to achieve this is by developing and capitalizing innovative products.

How to develop and capitalize innovative products in Romania? Outside an answer to this key question, outside outlined solutions, the answers to all other questions are fragile. Innovation is not a one-time act, it is a process. This process should be developed and carried out with lots of maturity and wisdom.

Indeed, the preparation for this takes time, it takes more time than any of us would want, because in itself it is a learning process, and changing the direction from outsourcing to innovation means, and it requires a change of culture.

During the first year in the life of the Cluster we have looked for different ways to build the cornerstone of this change.

We say that it is a change of culture, because we envision moving from a fragmented IT environment, with a lot of mistrust, into an environment based on cooperation between companies, universities and public institutions. This is about changing the way that fundamental research gets to serve pragmatic and lucrative purposes, through technological transfer, instead of being confined to the narrow circle of researchers. We are talking about the change in our corporate culture, as our companies do not consist of "resources" hired by the hour, but are made of valuable people who can and want, through their initiatives, to contribute to the success of their companies; they are made of people who deserve to benefit from this success. We are talking about a cultural change from rigid systems, reluctant to risk, where each aspect is strictly regulated, towards dynamic and adaptive systems where courageous initiatives are supported and can flourish organically. All these changes required, and still require time. But now, after over a year of working together in the Cluster, even if less visible from the outside, we know that we are on the right track and that we can assume with great boldness the next steps.

Currently in Romania and especially in Cluj, we are in a period of great effervescence of the start-up culture in IT. There is access to information; there are lots of inspirational examples in the more developed markets, we begin to have people and organisations that coagulate this movement through events, meeting centres and co-work centres, and even accelerators. We also know that there is money that can be reached, it is not impossible to get it once we are able to support a value proposition and we can convince that we have the ability and the maturity to put our ideas into execution. We know that innovative products are built and supported by entrepreneurs; therefore it is essential to have them and to support them.

Now we have enough organizational maturity to be able to support such a process in a relevant way.

Cluj IT aims to be a catalyst for the entrepreneurial environment in Cluj and Romania.

We aim to be a coagulation factor and to ease up the communication processes within the ecosystem of start-ups, thus creating an environment where it can grow in an organic, collaborative way and not fragmented or circumstantially. We intend to foster the cooperation between start-ups and mature businesses, academia and the public administration. We aim to develop a durable framework for entrepreneurial education, addressed not just to the start-ups but also to the mature organizations dealing with the challenge of reinventing themselves, the challenge of discovering the potential of their employees and to support the internal entrepreneurship (the term intrapreneurship was already created for this).

Between the mature business environment and the start-ups there is still a gap that we need to bridge in order to create a healthy ecosystem. The mature companies benefit from the availability of a good level of resources, both human and financial, they also have operational experience and relevant partnerships, they understand the business verticals and have a good knowledge of the external markets mechanisms, where they operate. However, many of them have rigid structures and processes, there is a great reluctance to risk and the intrapreneurial initiative is not encouraged. On the other hand, the young entrepreneurs don"t have enough resources and operational experience, they have poor knowledge over the business segments that they would like to serve, and they don"t have enough knowledge of the specific geographic markets in which their ideas could turn into success. Enthusiasm is essential, but it does not compensate for the lack of experience and the unavoidable difficulties in the process of entrepreneurial self -education may become discouraging. Those two sides need each other; without filling this gap the Romanian IT environment might evolve through struggles rather than attaining its full potential. Therefore it is very important for us to address this issue and to create a relevant dialogue between the two sides, to encourage the development of partnerships.

Also, the exchange of information and knowledge between the IT companies is essential, especially concerning methodologies and best practices, as well as specific geographic markets.

We aim to facilitate the access to relevant consultancy from mature markets, the access to operational or financial partners, and the direct funding, especially to venture capital.

Concerning the relationship with the academic environment, a permanent brokerage program is prepared in order to facilitate the cooperation in research, to align the research with the market needs and to foster the technological transfer in order to build innovative products.

So, we do have a strategy. You will of course ask if we do have a plan. Indeed we have it, but it matters less to declare it and it matters much more to prove it. Because, as many investors and entrepreneurs say, the ideas are valuable, but the execution is what matters most..

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